Feds will not reconsider their denial of Jordan Cove LNG terminal in Coos Bay

Federal regulators announced Friday they won't reconsider their decision to deny permission for the Jordan Cove liquefied natural gas export terminal in Coos Bay and a feeder pipeline stretching halfway across the state.

The Federal Energy Regulatory Commission issued a decision in March denying an application to build the $7.6 billion project.

Commissioners said backers failed to show enough of a public need for the project to overcome the negative impact on landowners along the Pacific Connector pipeline's 232-mile route. Essentially, regulators said the backers hadn't demonstrated any demand for the project.

Veresen, the Calgary-based energy company backing the project, quickly asked regulators to reconsider. They also submitted preliminary agreements with Asian utilities and the terminal operator to prove that there was demand for the terminal as well as pipeline capacity.

The commission issued a new order Friday denying the request for rehearing. It said backers had plenty of time -- three and a half years -- to demonstrate a need for the facility, but failed to do so. They also said backers failed to demonstrate any extraordinary circumstances that merited reopening the record.

"We're clearly disappointed with the denial and the Veresen board is considering all options for moving forward with the project," said Michael Hinrichs, a spokesman for Jordan Cove Energy Project. "The board remains committed to the project and believes it would provide significant economic benefits to Southern Oregon."

The project is a significant point of contention in Coos Bay and along the pipeline route. Boosters said the project would bring badly needed jobs and tax revenues to rural communities.

Hinrichs said backers have already spent more than $400 million on the project. But they faced serious headwinds, including a worldwide glut of liquefied natural gas.

Friday's decision is a victory for landowners, local residents and conservation groups, who have spent more than a decade trying to kill what was first proposed as a gas import project in 2004.

They believe the pipeline, the terminal and the power plant that would provide electricity for the terminal pose significant public safety and environmental risks, and would require widespread use of eminent domain to build the pipeline across private land.

Landowners argued to regulators that the pipeline would have negative economic effects, including lowered land values and harms to farming, timber operations and oyster harvesting. The commission concluded that "Pacific Connector failed to justify its project."

"Hopefully this is the final nail in the coffin and we can move on with our lives," said Jody McCaffree, a Coos Bay resident who has led local opposition. "This project was never appropriately sited, but FERC never even got into that."

Jordan Cove's backers could submit an entirely new application, the commission said. Alternately, they could appeal the decision to the U.S. Circuit Court of Appeals.

"This should be the end of this LNG project but we will have to remain vigilant to ensure that is the case," said Hannah Sohl, director of Rogue Climate, one of the organizations opposing the project.